Whether the assessee is required to add room rents while providing the services of 'Mandap' as 'Mandap Keepers’ when rooms are simultaneously rented out to the persons for holding marriage functions or conferences alongwith the 'Mandap'?

CASE STUDY

Introduction:-

There was big dispute on this count between the department and hotel industry. The rooms are booked along with Mandap in the hotel. The department says that room rent is part and parcel of Mandap and the service tax is payable on complete amount. But the Hotel industry says that there was no service tax on rooms at the relevant time and no function takes place in the rooms. Hence, it cannot be treated as Mandap. The CBEC clarified by its circular that Mandap means Halls, rooms etc. let out by Hotels, restaurants for consideration for organizing social, official or business functions are covered within the scope of “mandap”, and such hotels and restaurants are covered within the scope of “mandap keeper”. The department relies on the same but the service provider interoperates that circular clearly says that the rooms should be used for organizing functions but no function takes place in the rooms. This is the dispute under current case study.

M/s Taj Hari Mahal Palace
[Order-In-Original no. 32/2012/ST/JPR-II dated: 17.09.2012]

Relevant Legal Provisions:

Finance Act, 1994

Section 65
(66) "mandap" means any immovable property as defined in section 3 of the Transfer of Property Act, 1882 and includes any furniture, fixtures, light fitting and floor coverings therein let out for a consideration for organizing any official, social or business function;
Explanation- For the purposes of this clause, social function includes marriage;
(67) "mandap keeper" means a person who allows temporary occupation of a mandap for a consideration for organizing any official, social or business function;
Explanation- For the purposes of this clause, "social function" includes marriage:"

CBEC Circular No. 96/7/2007-ST dt. 23.8.2007

012.01 / 23.08.07

“Mandap” is defined as any immovable property as defined in section 3 of the Transfer of Property Act, 1882 and includes any furniture, fixtures, light fittings and floor coverings therein let out for a consideration for organizing any official, social or business function. [section 65(66)]

“Mandap keeper” is defined as a person who allows temporary occupation of a mandap for a consideration for organising any official, social or business function [section 65(67)].

Whether hotels / restaurants letting out their halls, rooms etc. for social, official or business functions fall within the definition of “mandap” and allowing temporary occupation of halls, rooms etc by such hotels / restaurants for organizing any official, social or business function is liable to service tax under “mandap keeper service” [section 65(105)(m)]?

Halls, rooms etc. let out by hotels / restaurants for a consideration for organising social, official or business functions are covered within the scope of “mandap” [section 65(66)], and such hotels and restaurants are covered within the scope of “mandap keeper” [section 65(67)].

Accordingly, service tax is leviable on services provided by hotels and restaurants in relation to letting out of halls, rooms, etc. for organizing any official, social or business function under mandap keeper service [section 65(105)(m)].

Issue: - Following issue was made before the Commissioner:-

Whether the assessee is required to add room rents while providing the services of 'Mandap' as 'Mandap Keepers’ when rooms are simultaneously rented out to the persons for holding marriage functions or conferences alongwith the 'Mandap'?

Brief Facts:-

The assessees are registered for payment of service tax as Mandap Keeper Service under sub-clause (105) (m) of section 65 of the Finance Act, 1994. During the audit of the assessee, for the period 4/06 to 9/09, it was observed that service tax of Rs. 792720/- was not paid by the assessee with respect to some rooms let out alongwith the banquet hall as package but did not include the room rent so received in the gross taxable value according to Section 65(105) (m) of the Finance Act, 1994 read with sub-rule (1) of Rule 5 of the Service Tax (Determination of value)Rules, 2006. As per CESTAT New Delhi’s order in the case of Raj Mahal Hotel Vs: CCE [(2006) 3 SRR 75 (New Delhi-CESTAT)], the issue regarding addition of room rent into the assessable value was decided in favour of the Revenue. It appeared that the assessee has collected an amount of Rs. 66159742on which service tax of Rs. 7912720/- was not paid by the assessee. As per CBEC, Circular No. 96/7/2007-ST dated 23.8.2007 Halls, Rooms etc. let out by Hotel/restaurants for organizing social, official or business functions are covered within the scope of Mandap Keepers.
A Show cause notice was accordingly issued to the assessee under C. No. V (ST) Adj.-II/191/2010 dated 23.8.2011 on the following accounts, as to why:-

(i)    Service Tax amounting to Rs. 79,12,720/- (ST Rs. 77,03,233/- + Ed. Cess Rs. 1,54,065/- + SHE Cess Rs. 55,423/-) should not be recovered from them under proviso to Section 73(1) of the Finance Act, 1994;
(ii)           Interest should not be recovered from them under Section 75 of the Finance Act;
(iii) Penalty should not be imposed upon them in terms of the provisions of Section 76 of the Finance Act, 1994 for contravention of Section 67 of the Act read with Sub Rule 1 of Rule 5 of the Service Tax Determination of Value) Rules, 2006;
(iv) Penalty should not be imposed upon them under Section 77 of the Finance Act, 1994 for not showing the full details of receipt of taxable value in the ST-3 returns contravening the provision of Rule 7 of the Service Tax Rules, 1994 read with Section 70 of the Finance Act, 1994;
(v)     Penalty should not be imposed upon them under provision of Section 78 of the Finance Act, 1994 for suppression of the facts/intentional evasion of Service Tax amounting to Rs. To Rs .79, 12,720/- (ST Rs. 77, 03,233/. + Ed. Cess Rs. 1, 54,065/- + SHE Cess Rs. 55,423/-.

Assessee’s Contentions:-

Assessee made following submissions before the Commissioner:

It was submitted that in the impugned show cause notice it is alleged that the assessee have let out some rooms along with the banquet hall as package but did not include the rent received in respect of such rooms in the gross taxable value. It was alleged that income for occupation of rooms by the customer/organization/family was required to be included in the gross amount charged from the customer for providing Mandap Keeper service. In this regard, it is submitted that no function was held within the rooms let out to the wedding parties/ conferences. The function of marriage or holding of conference cannot be said to be held in the room of the hotel. The said rooms were merely occupied for the sole purpose of resting temporarily but no service was provided which falls within the purview of Mandap Keeper service.
From the definition of “Mandap” it is clear that it is a Mandap or a hall which is required to be used for organizing any official, social or business function. However, in the rooms let out by us to our clients no such function could be held/organized. The only purpose for which the said rooms were occupied by the few members of the marriage party was for rest and refreshment purpose only. The size and space of the said rooms do not allow holding of any function which will be covered under the definition of Mandap Keeper service. Therefore, it cannot be said that they have provided a composite service to our clients/wedding party.

The assesee further submit that in the impugned show cause notice reference has been made to sub-rule (1) of Rule 5 of the Service Tax (Determination of value) Rules, 2006 and it has been contended that all the expenditure or costs incurred by the service provider (including re-imbursement of expenses) shall be included in the value, except those incurred as a pure agent under Rule 5 (2) of the Rules. In this regard, it is again re-iterate that all the costs/expenditure incurred by us in relation to the providing the service of Mandap keeper was included in the gross value of the service. However, as no service of the nature of Mandap Keeper was provided in the rooms let out to the wedding party/clients etc, therefore, they have not included the consideration received for letting out the said rooms in the gross value of the said service. Therefore, no contravened the provisions of the Service Tax (Determination of value) Rules, 2006 as alleged in the impugned show cause notice. Thus, the impugned show cause notice is required to be set aside.

We further submit that in the impugned show cause notice reliance has been placed on the decision of the Tribunal in the case of M/s Rajmahal Hotel v/s CCE [(2006) 3 SRR 75 (New Delhi-CESTAT)] wherein it was held that the hotels provided its hall and in addition allotted rooms to persons booking the hall, but these rooms were shown in the books as occupied by independent service receivers, it was an attempt to conceal income being granted as ‘mandap keeping’ service under the garb of room rent receipts and such room rent receipts are also includible in the value of taxable service.
In this regard, we submit that in the afore-said judgment the finding was given with regard to renting of hall in the assessee’s hotel for organizing social functions. But no finding has been given with regard to the letting out of rooms for residential occupation. A perusal of the operational part of the afore-said judgment clearly provides that the judgment is delivered with regard to renting/letting out of hall for marriage purpose but nowhere it is mentioned that the consideration received for rooms given on rent to the marriage party was also to be included in the gross value of service of Mandap Keeper provided by the said Hotel. Therefore, the said judgment is not applicable in instant case.
In continuation to the above, it was submitted that they have placed reliance on the decision of the tribunal in the case of Merware Estate v/s Commissioner of Central Excise, Jaipur [2007 (078) RLT 0030 (CESTAT-Del)] wherein it was held that while a 'mandap' is not a residential property 'hotel' is used for residence, though temporarily. Unlike in a 'mandap' no public activity can be said take place in the privacy of a hotel room. In the relied upon case, the assessee owned a hotel and also two gardens, which are situated, just adjacent to the hotel building. Bookings of hotel and the said two gardens were made by the customers for which separate bills were raised by the assessee. It had paid service tax on the services rendered in respect of the gardens as a 'mandap keeper'.

The assesee further submitted that in the impugned show cause notice reliance is placed on the Board Circular No. 96/7/2007-ST dated 23.08.2007. In this regard, it is submitted that in the above circular also the words used are that the halls and rooms etc should be let out for organizing social, official or business functions. But in instant case the rooms were not let out for the purpose of providing Mandap Keeper service. No social, official or business function was organized in the rooms let out to service recipients. It is submitted that merely because the words “room” is mentioned it cannot be said that even if the rooms were let out for any other purpose they will be covered under Mandap keeper service. It is submitted that this conclusion is not drawn from the reading of the legal provisions. Also, merely because room was let out to clients/wedding party does not automatically imply that these rooms were used for providing Mandap Keeper service. In the impugned show cause notice also it has not been established that the said let out rooms were used for providing Mandap Keeper service. Therefore, it cannot be held that the rooms let out were provided for the purpose of organizing social, official or business functions. It is submitted that the said rooms were let out for resting or residential purposes only. And as room rent is kept out of the purview of Service tax during the relevant period, no service tax can be demanded on the same.
The impugned show cause notice the extended period of limitation of five years has been invoked. In this regard, it is submitted that the service provider have not suppressed any facts from the Department and the extended period of limitation is erroneously invoked. It is submitted that there was no service tax on the room rent at the relevant time i.e. from April, 2006 to September, 2009. Therefore, when the rent charged on the rooms was outside the purview of service tax, then there was no necessity nor any such requirement was prescribed that the assessee was required to give the figures in the ST-3 form or give separate intimation to the Department of the same. It is submitted that when no such requirement was prescribed in the legal provisions, then it cannot be alleged that the service provider have not furnished the details of rent collected on letting out of rooms with intent to evade payment of service tax. Reliance is placed on following case laws:-

M/s Neptune Equipment Pvt Limited v/s CCE, Ahmedabad [2011-TIOL-1069-CESTAT-AHM]

M/s Reliance Industries Ltd v/s CCE, Vadodara [2011-TIOL-636-CESTAT-AHM]

M/s Aadishwar Motors Pvt Ltd v/s CST, Ahmedabad [2011-TIOL-428-CESTAT-AHM]

M/s Stone & Weber International Inc v/s CCE, Vadodara [2011-TIOL-330-CESTAT-MUM]–
COLLECTOR OF CENTRAL EXCISE Versus CHEMPHAR DRUGS & LINIMENTS [1989 (40) ELT 276 (SC)]

DEVANS MODERN BREWERIES LTD. Versus COMMISSIONER OF C. EX., CHANDIGARH [2006 (202) ELT 744 (SC)]

PADMINI PRODUCTS Versus COLLECTOR OF C. EX. [1989 (43) ELT 195 (SC)]

LUBRI-CHEM INDUSTRIES LTD. VersusCOLLECTOR OF CENTRAL EXCISE, BOMBAY [1994 (73) ELT 257 (SC)]

CCE, Chennai v/s M/s Madhusudhan Industries [2009-TIOL-774-CESTAT-MAD]

CCE, Mangalore v/s M/s Pals Microsystems Ltd [2011-TIOL-70-SC-CX]

M/s Ess Ess Engineering c/s CCE, Chandigarh [2010-TIOL-1447-CESTAT-DEL]

CCE, Jaipur v/s M/s Pushp Enterprises [2011-TIOL-297-CESTAT-DEL]

M/s Marikar Motors Ltd v/s CCE, Thiruvananthapuram [2011-TIOL-823-CESTAT-BANG]

Rajasthan State Warehousing Corp v/s Commr of C. Ex, Jaipur [2011 (23) STR 385 (Tri-Chennai)]

The assessee further submitted that they have acted under bona fide belief that room rent will not be included in the gross value charged for providing Mandap Keeper service. This bona fide belief is also based on the tribunal decision cited above. It is submitted that the purpose of letting the rooms on rent to the wedding party was not to provide any service relating to Mandap Keeper to the said clients. Therefore, it is submitted that when they have acted under bona fide belief therefore, no adverse penal action can be taken against us. Therefore, no penalty can be imposed on us as we have acted under bona belief. In this regard, reliance is placed on the following judgments:

M/s Aditya Birla Nuvo Ltd v/s CCE, Vadodara [2011-TIOL-353-CESTAT-AHM]

M/s Infinity Credit v/s CCE, Jaipur [2009-TIOL-589-CESTAT-DEL]:

CCE, Coimbatore Vs M/s A P Vivekanandan & Co [2009-TIOL-478-CESTAT-MAD]

Commissioner of Central Excise v/s ESS ESS Engineers [2011 (23) S.T.R. 3 (P & H)]

In the above cases, it has been held that when the assessee acted under bonafide belief, no penalty can be imposed on them. Some other cases in support of our contention are cited as follows:-

*          Star Neon Singh vs. Commissioner of Central Excise,    Chandigarh [2002 (141) ELT 770 (Tri.-Del.)]

*          Straw Products Ltd. vs. Collector of Central Excise, Indore [1996 (87) ELT 115 (Tribunal)]

*          Johnson & Johnson Ltd. vs. Collector of Central Excise, Bombay [1995 (78) ELT 193 (Tribunal)]

*          Indian Explosives Ltd. vs. Collector of Customs [1992 (60) E.L.T. 111 (Cal.)]

*          Tata Engineering & Locomotive Co. Ltd. vs. Collector of Customs [1991 (56) E.L.T. 812 (Tribunal)]

*          Surat Municipal Corpn. Vs. Commissioner of C. Ex., Surat [2006 (4) S.T.R. 44 (Tri. - Del.)]


It is further submitted that this is not the first show cause notice has been issued. Earlier also show cause notice has been issued on the same issue to the same party. Hence the show cause notice on this issue has already been issued and the second show cause notice on the same issue cannot invoke the extended period and hence the demand is barred by time of limitation. The asesee submitted that the demand is overlapping. As mentioned in above point, the demand is already issued for the same period but it is once again issued. Hence the demand is overlapping. The demand for complete period was already issued. The demand was earlier issued for wedding ceremonies only. But this time the demand is issued for wedding plus conferences.

Alternatively, it is further submitted that in case the demand of service tax is confirmed against us, then the liability of service tax should be calculated after allowing the benefit of abatement to us. It is submitted that we are also availing benefit of abatement under Notification No. 1/2006-ST dated 01.03.2006 as we are also providing the service of catering along with mandap Keepr service. Therefore, in case the value of room rent is held to be included in the gross value of service of Mandap Keeper then the abatement should be deducted from the said amount and the service tax liability should be calculated on the remaining amount.
Alternatively, it is submitted that the impugned show cause notice is proposing to impose penalties under Section 76 as well as under Section 78 simultaneously. In this regard, we submit that the Section 76 and Section 78 are mutually exclusive provisions and penalty cannot be imposed simultaneously under the provisions of both the Sections. It is provided in section 78 of the Finance Act, 1994 that if penalty is payable under section 78 than penalty under section 76 will not leviable. The provision is reiterated here under:-

Proviso to section 78:-

Providedalso that if the penalty is payable under this section, the provisions of section 76 shall not apply.

When there is clear cut provision in the Section itself then there is no dispute on the same. Hence the impugned show cause notice is totally erroneous and liable to be set aside.
M/s Anand Agencies v/s CCE (Service Tax), Coimbatore [2010-TIOL-364-CESTAT-MAD]

M/s AR AS PV PV Motors Erode (P) Ltd v/s CCE, Salem [2010-TIOL-1241-CESTAT-MAD]

COMMISSIONER OF C. EX., SALEM Versus PHOENIX MARKETING [2010 (19) S.T.R. 755 (Tri. - Chennai)]

JOE TRANSPORT Versus COMMISSIONER OF CENTRAL EXCISE, TRICHY [2010 (18) S.T.R. 646 (Tri. - Chennai)]

ANDHRA BANK Versus COMMISSIONER OF C. EX., HYDERABAD [2010 (18) S.T.R. 475 (Tri. - Bang.)]

COMMISSIONER OF CENTRAL EXCISE, SALEM Versus PKN BUS SERVICE [2010 (18) S.T.R. 424 (Tri. - Chennai)]

COMMISSIONER OF CENTRAL EXCISE, CHANDIGARH Versus GREWAL TRADING CO.[ 2010 (18) S.T.R. 350 (Tri. - Del.)]

SAFE TEST ENTERPRISES Versus COMMR. OF C. EX., SALEM [2010 (18) S.T.R. 172 (Tri. - Chennai)]

THE FINANCERS Versus COMMISSIONER OF CENTRAL EXCISE, JAIPUR [2007 (8) S.T.R. 7 (Tri. - Del.)]

COMMISSIONER OF C. EX., LUDHIANA Versus AKASH CABLE [2010 (19) S.T.R. 753 (Tri. - Del.)]

M/s SRI Selvam Agency Vs Commissioner of Central Excise, Salem [2010-TIOL-1616-CESTAT-MAD]

Commissioner of Central Excise, Chandigarh-I Vs M/s Cool Tech Corporation, Chandigarh [2011-TIOL-23-HC-P&H-ST]

Further, written submission were presented at the time of personal hearing. The assessee has relied upon latest decision of Ram bagh palace v. CCE, Jaipur- I wherein the matter on idetenical issued is decided by Delhi Tribunal in favour of assessee.

Reasoning of the Commissioner:-

The Commissioner observed that from CBEC Circular No. 96/7/2007-ST, it is clear that Halls, rooms etc. let out should discharge duty liability as Mandap when used for organizing any official, social or business functions. It is not brought out in the show cause notice dt. 23.8.11 that the rooms rented out to the persons are in fact used for organizing the specified functions. It is not the case of the department that it is compulsory for the persons organizing functions to take the rooms on rent when a function is being organized in the ‘Mandap’ of the assessee and that always a fixed number of rooms were taken by the persons when organizing specified functions, In the absence of any documentary evidence to the fact, that no official, social or business functions were held in the rooms rented out by the assessee, CBEC circular no. 96/7/2007-ST will not be applicable to the assessee's case. Reliance has also been placed in the show cause notice upon the judgement of CESTAT in the case of Rajmahal Hotel Vs CCE(Supra). Assessee has submitted that CESTAT's judgment is not a valid law in view of the judgment of CESTAT in the case of Merwara Estates Vs CCE Jaipur (2009(16)S.T.R 268(Tri-Del.)j. It is observed that following order was passed by the CESTAT double bench in the case of Merwara Estate Vs CCE Jaipur (supra).
“We find that a prima facie view was taken at the stay stage that the Appellants are not liable to pay Service Tax in respect of the charges recovered for renting of the hotel. The only submission by the Revenue is that the cited decision in the case of Rajmahal Hotel (supra) supports the Revenue's case. However, we find that the said decision only authorizes levy of Service Tax on renting of halls attached to the hotel but not in respect of' renting of the hotel rooms. As such, we confirm the prima facie view taken by the Tribunal earlier and set aside the impugned order and allow the appeal."
They held that it is evident from this reasoning made by CESTAT in the case of Merwara Estate Vs CCE Jaipur (supra) that it has to be a complementary obligation for service recipient to take both the halls & the gardens for holding functions. But in the present proceedings there is no complementary compulsion on the part of the persons holding functions to take simultaneously a specific number of rooms to hold the social or official functions in the Mandap. This distinction has been further elaborated by CESTAT in the case of Desert Inn Limited Vs CCE Jaipur case [2011(23)5TR 254(Tri.-Del.)}. From the bare perusal of the definition of the services brought under tax vide sub-section 65(105)(m) of Finance Act, 1994, they find that any services provided by the assessee to their client in relation to Mandap Keeper is also to be included in the services of Mandap Keeper. It is an admitted fact that the Car parking was made available to the clients who availed the services of the Mandap.

Hence, they were not in agreement with them that this car parking was a separate service provided by the appellants to their client. Further, the case law cited by them in the case of Merwara Estates (supra) is not applicable to the facts of this case. As in that case, apart from the Mandap, the rooms in the hotel were availed by the client. It is admitted fact that the rooms of the hotel are not necessary for use of the Mandap. But in this case, the car parking is a necessary facility for use of the Mandap. Further the charges are payable by the person who uses the Mandap. Hence, the facts are distinguishable and the ratio in the case of Merwara Estates is not applicable to the facts of this case. Further, reliance placed by the appellant that they have clearly mentioned the car parking charges in their balance sheet separately which is a public document and the extended period is not invokable alleging suppression the facts in this case. In this it was not coming out from the balance sheet whether these car parking charges are collected by the appellants from the same client using Mandap facility or not. Hence, the facts are distinguishable in the case of Martin Harris Laboratories Ltd. (supra). It is admitted by the appellants that due to rush of vehicle the problem of parking is assuming utmost importance and the appellants who holds a banquet hall has to provide some parking space to be used for parking of vehicles by the guests of the client holding a function 'in the banquet hall. The said statement by the appellants also confirmed the view of this Tribunal that the car parking facility has been provided by the appellants in relation to the service provided for the Mandap. The appellants have suppressed the fact from the department that these car parking charges are collected from the clients who are using the Mandap. Hence, the lower authorities has rightly invoked the extended period of limitation.

With regard to the penalties, they find that in the impugned order both the penalties under Section 76 and 78 of the Finance Act have been confirmed and no option to the appellants has been given to pay 25% of the penalty within 30 days of the order of adjudication. Accordingly, they give this option to the appellants following the decision in the case of K.P. Pouches (P) Ltd. V. UOI reported in [2008 (228) E.L.T. 31)]. Once penalty under Section 78 is imposed, penalty under Section 76 is not maintainable. The demands confirmed by the lower authorities on account of service tax payable on car parking charges which are received in relation of Mandap Keeper Services are confirmed along With interest. Only penalty under Section 78 is confirmed with an option to pay the entire demand along with interest and 25% of penalty under Section 78 of the Finance Act, 1994 following the decision in the case of K.P. Pouches wherein the Hon’ble Delhi High Court has given an option to pay 25% of the penalty within 30 days of the order of adjudication. It is pertinent to mention that if the appellants fail to pay the entire Service Tax demands along with interest and 25% of the penalty within 30 days of the communication of this order, the appellants shall be liable to pay 100% service tax as penalty confirmed by the adjudication order. With these directions, the appeal is disposed of. From this judgment it is clear that an activity which becomes a complementary obligation for discharging / availing the service of Mandap will be required to be added to the taxable value for the purpose of discharging service tax.

Based on these findings, they did not hold that show cause notice dt. 23.8.2011 has any legs to stand on merits. The demand is therefore required to be discharged on merits and accordingly no interest under Section 75 of the Finance Act, 1994 can also be held as leviable.
Further the assessee also argued that on the same issue two more show cause notices were issued. It was observed that both show Cause notices were issued to the assessee on the issue when wedding ceremonies were held during the period April, 2006 to March 2010. Show Cause Notice dt. 4.10.2010 has already been issued for extended period. In the present show cause notice the period involved is also April, 2006 to Sep, 2009. On merit the issue is also same. The only difference is that the two show cause notices were issued for rooms rented out in relation to wedding ceremonies whereas in the present proceeding it not only includes service tax on room rent with respect to wedding ceremonies again but also service tax on room rent & food with respect to other official functions. It is a well accepted judicial principle that demand for extended period on an issue can not made again when a show cause notice for extended period is already issued to the assessee. It is possible that due to calculation mistake a show cause notice is required to be corrected as a corrigendum but a new show cause notice again issued by invoking extended period, can not be held to be a valid show cause notice and is required to be discharged as time barred.
So far as imposition of penalties under Section 76, 77 & 78 of the Finance Act, 1994 are concerned it is observed that true & full disclosure of the receipts was made by the assessee in the books of accounts, from where the details of room rents, in relation to marriage ceremonies, were picked up by the department while issuing the show cause notices dt. 4.10.2010 & 7.10.2010 already issued. Once show cause notices on an issue are already issued then it can not be said that department was not aware of facts or that there was any suppression of facts on the part of the assessee with intention to evade service tax. Accordingly no penalty can be imposed upon the assessee. In the present proceedings when there is no willful suppression to evade service tax and no tax is held recoverable from the assessee.

Decision:-

The proceedings against the assessee was dropped both on merit as well as on limitation.


Conclusion:-

This is very important both on merits in favour of assessee. A number of Hotels were facing same kind of demand all over India. But the demand has been dropped saying that when you book for marriages it is not compulsory for the client to book rooms also. He may or may not take the rooms along with mandap keeper. Further, no function takes place in rooms. Hence, this is very good decision by the commissioner. Hope that it will put an end to litigation.

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PJ/CASE STUDY/ 2012-13/25
29 September 2012